Health Affairs, 24, no. 3 (2005): 790-801 doi: 10.1377/hlthaff.24.3.790 © 2005 by Project HOPE	New Online   New Issue: China & India   Obesity In China   Pay Cuts For Medicare Docs   Access To Care Woes

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Making Profits And Providing Care: Comparing Nonprofit, For-Profit, And Government Hospitals

Three types of entities—nonprofit, for-profit, and government—own hospitals. Yet we know neither whether hospital types specialize in different medical services nor how service profitability affects specialization. In this econometric analysis of American Hospital Association data for every U.S. urban, acute care hospital (1988–2000), more than thirty services were categorized as relatively profitable, unprofitable, or variable. For-profits are most likely to offer relatively profitable medical services; government hospitals are most likely to offer relatively unprofitable services; nonprofits often fall in the middle. For-profits are also more responsive to changes in service profitability than the other two types.

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